Minister Dr. Optendrenk: “High demand for our 10th sustainability bond shows how great investors’ trust is in the state of North Rhine-Westphalia.”
The state of North Rhine-Westphalia has issued a sustainability bond for the 10th time. Minister of Finance Dr. Marcus Optendrenk symbolically announced the listing of the anniversary bond with the traditional ringing of the stock exchange bell. The country's 10th sustainability bond has been listed on the Düsseldorf stock exchange since June 7, 2023. It has a volume of 2 billion euros and a term of 10 years. The bond is used to finance more than 50 social and environmental projects that contribute to achieving the Sustainable Development Goals and is particularly aimed at investors who want to invest their money sustainably. The focus of the content is on the topics of education, research & infrastructure as well as renewable energies. The bond finances, among other things, the exemption from contributions for the last two years of daycare and offers for language support, thus enabling the children to be optimally prepared for school. Preventive flood protection and the reforestation of forests are also among the projects financed by the bond. Additional funds are used to improve the quality of teaching and studies at universities and for social work at schools. The expansion of photovoltaics is also being strongly promoted in order to reduce dependence on energy imports and support structural change.
The anniversary bond was in extremely high demand on the day it was issued. More than 170 investors subscribed for a volume of more than 13 billion euros, more than six times the amount of the bond - a new record for the country's sustainability bonds. 2/3 of the bond went to investors who were classified as sustainable or very sustainable by the state of North Rhine-Westphalia based on specially selected criteria.
Minister of Finance Dr. Marcus Optendrenk: “We have been on the right track here for a long time and are investing sustainably in the future viability of our country. The high demand for our 10th sustainability bond shows how great the trust investors have in the state of North Rhine-Westphalia and how convincing we are with our transparent and well-considered entry into the market as a sustainable issuer. I experience this again and again in conversations, especially with institutional investors.”
Unlike conventional bonds, which help finance the general state budget, sustainability bonds are project-related and therefore serve to finance very specific sustainable projects. With the sustainability bonds, the state is specifically targeting investors who place particular value on investing in long-term, sustainable projects that are worthy of support, such as measures for the professional integration of people with disabilities, such as workshops for people with disabilities or the creation of additional jobs for people with disabilities in inclusion companies . The country supports these investment decisions by placing emphasis on a particularly high level of transparency in its sustainability bonds. As last year, the country explained in detail the extent to which the funded ecological projects meet the new EU taxonomy regulation.
For more than half of the planned ecological expenditure, the ISS ESG agency confirmed that the projects are in line with the EU Taxonomy Regulation and that all bond projects contribute to the sustainable development goals. As in previous years, the Wuppertal Institute calculated the positive effects achieved with the 9th sustainability bond issued last year. This bond was used, among other things, to support more than 147,000 broadband internet connections, to attract 20 young scientists from abroad, to set up a research group, and to contribute to the construction of 111 km of cycle paths. Overall, the projects of the 9th Sustainability Bond saved 26,600 tons of CO2 per year - this corresponds to 7,600 additional trees planted. With all previous sustainability bonds, a total of more than 2.2 million tons of CO2 were saved over the entire term of the projects.
The state of North Rhine-Westphalia has been successfully issuing sustainability bonds since 2015 and is a pioneer in this segment. It defends this position through continuous improvements to its sustainability bonds. To date, ten sustainability bonds have been issued with a total volume of more than 22 billion euros. The country's sustainability bonds have received an extremely positive response. The state of North Rhine-Westphalia was voted the best regional government issuer of green/SRI bonds (Socially Responsible Investment) by market participants worldwide in 2017, 2019, 2021 and 2022 in surveys conducted by the international trade magazine “GlobalCapital” and accordingly excellent.
The full press release and further links on the topic can be found here..
